The IMF just boosted its growth forecast for Britain's economy to 2%
- Author: Zachary Reyes Apr 20, 2017,
Apr 20, 2017, 19:54
With buoyant financial markets and a long-awaited cyclical recovery in manufacturing and trade under way, world growth is projected to rise from 3.1 per cent in 2016 to 3.5 per cent in 2017 and 3.6 per cent in 2018, the International Monetary Fund said in its latest World Economic Outlook (WEO) forecast.
The IMF also adjusted upward its prediction for the global economy to 3.5 percent in 2017, up 0.1 percent from its January forecast.
Maurice Obstfeld, IMF's economic counselor and director of the research department, said on Tuesday that momentum in the global economy has been building since the middle of last year, allowing the IMF to reaffirm its earlier forecasts of higher global growth this and next year.
This is better than the most recent forecast by the Australian Treasury and released by the Australian government in December a year ago, which predicted GDP would "pick up to 2?? per cent in 2017-18 as the detraction from mining investment eases".
The IMF left its USA forecast unchanged for 2017 and 2018, at 2.3% and 2.5%, respectively, after raising its projections in January on Trump's plan to cut taxes and boost infrastructure spending. "Moreover, the economic growth must be also seen in Romanians' incomes", the chief of Government also said.
Protectionism, is no. 1 risk for the International Monetary Fund, as an inward shift in policies, including toward protectionism, could lower global growth as trade and cross-border investment flows would be reduced. Urban consumer inflation hit 30.9 percent year-on-year in March, its highest in decades, though month-on-month inflation has slowed.
The eurozone economy is expected to grow 1.7 percent this year, up 0.1 point, and 1.6 percent next year, unchanged, against an estimated 1.7 percent last year.
The report warns that this could trigger more protectionist policy actions on trade and immigration.
Japan's forecast was revised up 0.4 points to 1.2 percent.
Based on the latest WEO, fiscal policy at the global level is projected to be broadly neutral in 2017 and 2018. The previous forecast was 3.1 percent for 2017.
The IMF also said that risks to the global outlook also could come from a faster-than-expected pace of interest rate hikes in the United States, which could trigger a sharp rise in the dollar and disruptive capital outflows from emerging markets. The Fund said negative effects from the United Kingdom vote to leave the European Union are taking longer to materialize.